Thursday, November 06, 2008

Motorola and Sun on the ropes | Icons no more | The Economist

“HAVE lunch, or be lunch.” The Silicon Valley mantra coined by Scott McNealy, the outspoken former boss of Sun Microsystems, a troubled computer-maker, still rings true as the technology industry heads into recession. At particular risk of being lunch are Sun and another once-mighty technology firm: Motorola, America’s ailing telecoms-equipment giant. Both posted dismal results on October 30th. Sun’s sales to Wall Street firms, which are among its biggest customers, fell by 20% in the most recent quarter compared with a year earlier, and it reported a loss of $1.68 billion. Sales at Motorola, meanwhile, fell by 15%, with unit sales of mobile phones down by a third, and a loss of $397m. Yet even before the downturn, both firms were in serious trouble.